Advanced Search
MyIDEAS: Login to save this paper or follow this series

Japan and Her Dealings with Offshoring: An Empirical Analysis with Aggregate Data

Contents:

Author Info

  • Agnese, Pablo

    ()
    (FH Düsseldorf)

Abstract

First moves towards a real understanding of offshoring date back to very recent times. In particular for Japan, the studies conducted so far focus alone on the productivity effects of offshoring at the firm level. Here I carry out the analysis of both the employment and productivity effects at the aggregate level of the industry, covering the years 1980-2005. Moreover, I consider all industries within the economy and take account of both services and materials offshoring. My results suggest that we should expect, on average, a positive effect of services and a negative effect of materials offshoring on employment. However, the effects are rather negligible and only amount to a 1.5 to 2 percent net loss of the change in employment. On the other hand, positive effects on the growth rate of productivity are found as a result of both types of offshoring, with larger effects from services. In particular, the average offshoring industry displays 1.4 to 1.98 additional percentage points for services and 0.48 to 0.64 for materials.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://ftp.iza.org/dp5517.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5517.

as in new window
Length: 42 pages
Date of creation: Feb 2011
Date of revision:
Handle: RePEc:iza:izadps:dp5517

Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org

Order Information:
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Email:

Related research

Keywords: offshoring; Japan; employment; productivity;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Ekholm, Karolina & Hakkala, Katariina, 2005. "The Effect of Offshoring on Labor Demand: Evidence from Sweden," Working Paper Series, Research Institute of Industrial Economics 654, Research Institute of Industrial Economics.
  2. Ilke Van Beveren, 2012. "Total Factor Productivity Estimation: A Practical Review," Journal of Economic Surveys, Wiley Blackwell, Wiley Blackwell, vol. 26(1), pages 98-128, 02.
  3. Alan G. Ahearne & Naoki Shinada, 2005. "Zombie Firms and Economic Stagnation in Japan," Hi-Stat Discussion Paper Series, Institute of Economic Research, Hitotsubashi University d05-95, Institute of Economic Research, Hitotsubashi University.
  4. Feenstra, Robert C & Hanson, Gordon H, 1996. "Globalization, Outsourcing, and Wage Inequality," American Economic Review, American Economic Association, American Economic Association, vol. 86(2), pages 240-45, May.
  5. Horgos, Daniel, 2007. "Labor Market Effects of International Outsourcing: How Measurement Matters," Working Paper, Helmut Schmidt University, Hamburg 62/2007, Helmut Schmidt University, Hamburg.
  6. Kee Hiau Looi, 2004. "Estimating Productivity When Primal and Dual TFP Accounting Fail: An Illustration Using Singapore's Industries," The B.E. Journal of Economic Analysis & Policy, De Gruyter, De Gruyter, vol. 4(1), pages 1-40, October.
  7. Vanessa Strauss-Kahn, 2003. "The Role of Globalization in the Within-Industry Shift Away from Unskilled Workers in France," NBER Working Papers 9716, National Bureau of Economic Research, Inc.
  8. ITO Banri & TOMIURA Eiichi & WAKASUGI Ryuhei, 2007. "Dissecting Offshore Outsourcing and R&D: A Survey of Japanese Manufacturing Firms," Discussion papers, Research Institute of Economy, Trade and Industry (RIETI) 07060, Research Institute of Economy, Trade and Industry (RIETI).
  9. Charles R. Hulten, 2001. "Total Factor Productivity. A Short Biography," NBER Chapters, National Bureau of Economic Research, Inc, in: New Developments in Productivity Analysis, pages 1-54 National Bureau of Economic Research, Inc.
  10. Zvi Griliches, 1995. "The Discovery of the Residual: A Historic Note," Harvard Institute of Economic Research Working Papers, Harvard - Institute of Economic Research 1742, Harvard - Institute of Economic Research.
  11. Edward E. Leamer, 1994. "Trade, Wages and Revolving Door Ideas," NBER Working Papers 4716, National Bureau of Economic Research, Inc.
  12. Kyoji Fukao & Hyeog Ug Kwon, 2005. "Why Did Japan's TFP Growth Slow Down in the Lost Decade? An Empirical Analysis Based on Firm-Level Data of Manufacturing Firms," Discussion papers, Research Institute of Economy, Trade and Industry (RIETI) 05004, Research Institute of Economy, Trade and Industry (RIETI).
  13. T. Miyagawa & Y. Sakuragawa & M. Takizawa, 2006. "Productivity And Business Cycles In Japan: Evidence From Japanese Industry Data," The Japanese Economic Review, Japanese Economic Association, Japanese Economic Association, vol. 57(2), pages 161-186.
  14. Alexander Hijzen & Holger Görg & Robert C. Hine, 2005. "International Outsourcing and the Skill Structure of Labour Demand in the United Kingdom," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 115(506), pages 860-878, October.
  15. Seung Chan Ahn & Hyungsik Roger Moon, 2001. "Large-N and Large-T Properties of Panel Data Estimators and the Hausman Test," 10th International Conference on Panel Data, Berlin, July 5-6, 2002, International Conferences on Panel Data A6-2, International Conferences on Panel Data.
  16. Berman, Eli & Bound, John & Griliches, Zvi, 1994. "Changes in the Demand for Skilled Labor within U.S. Manufacturing: Evidence from the Annual Survey of Manufactures," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 109(2), pages 367-97, May.
  17. Hakkala, Katariina & Heyman, Fredrik & Sjöholm, Fredrik, 2007. "Cross-Border Acquisitions, Multinationals and Wage Elasticities," Working Paper Series, Research Institute of Industrial Economics 709, Research Institute of Industrial Economics.
  18. Eiichi Tomiura, 2004. "Foreign outsourcing and firm-level characteristics: evidence from Japanese manufacturers," Hi-Stat Discussion Paper Series, Institute of Economic Research, Hitotsubashi University d04-64, Institute of Economic Research, Hitotsubashi University.
  19. Egger, Hartmut & Egger, Peter, 2005. "Labor market effects of outsourcing under industrial interdependence," International Review of Economics & Finance, Elsevier, Elsevier, vol. 14(3), pages 349-363.
  20. Paul Krugman, 1995. "Technology, Trade, and Factor Prices," NBER Working Papers 5355, National Bureau of Economic Research, Inc.
  21. Fumio Hayashi & Edward C. Prescott, 2002. "Data Appendix to The 1990s in Japan: A Lost Decade," Technical Appendices, Review of Economic Dynamics hayashi02, Review of Economic Dynamics.
  22. David Hummels & Jun Ishii & Kei-Mu Yi, 1999. "The nature and growth of vertical specialization in world trade," Staff Reports, Federal Reserve Bank of New York 72, Federal Reserve Bank of New York.
  23. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, Elsevier, vol. 68(1), pages 29-51, July.
  24. Jacob Funk Kirkegaard, 2007. "Offshoring, Outsourcing, and Production Relocation—Labor-Market Effects in the OECD Countries and Developing Asia," Working Paper Series, Peterson Institute for International Economics WP07-2, Peterson Institute for International Economics.
  25. Ricardo J. Caballero & Takeo Hoshi & Anil K. Kashyap, 2008. "Zombie Lending and Depressed Restructuring in Japan," American Economic Review, American Economic Association, American Economic Association, vol. 98(5), pages 1943-77, December.
  26. Head, Keith & Ries, John, 2002. "Offshore production and skill upgrading by Japanese manufacturing firms," Journal of International Economics, Elsevier, Elsevier, vol. 58(1), pages 81-105, October.
  27. Keiichiro Kobayashi, 2004. "Payment Uncertainty and the Productivity Slowdown," Discussion papers, Research Institute of Economy, Trade and Industry (RIETI) 04029, Research Institute of Economy, Trade and Industry (RIETI).
  28. Hicks, J. R., 1975. "Value and Capital: An Inquiry into some Fundamental Principles of Economic Theory," OUP Catalogue, Oxford University Press, Oxford University Press, edition 2, number 9780198282693, October.
  29. Alexander Hijzen, & Tomohiko Inui, & Yasuyuki Todo, . "Does Offshoring Pay? Firm-Level Evidence From Japan," Discussion Papers 07/14, University of Nottingham, GEP.
  30. Sourafel Girma & Holger Görg, 2004. "Outsourcing, Foreign Ownership, and Productivity: Evidence from UK Establishment-level Data," Review of International Economics, Wiley Blackwell, Wiley Blackwell, vol. 12(5), pages 817-832, November.
  31. Fumio Hayashi & Edward C. Prescott, 2000. "The 1990s in Japan: a lost decade," Working Papers, Federal Reserve Bank of Minneapolis 607, Federal Reserve Bank of Minneapolis.
  32. Feenstra, Robert C. & Hanson, Gordon H., 1997. "Foreign direct investment and relative wages: Evidence from Mexico's maquiladoras," Journal of International Economics, Elsevier, Elsevier, vol. 42(3-4), pages 371-393, May.
  33. Matthew J. Slaughter, 1995. "Multinational Corporations, Outsourcing, and American Wage Divergence," NBER Working Papers 5253, National Bureau of Economic Research, Inc.
  34. Slaughter, Matthew J., 2000. "Production transfer within multinational enterprises and American wages," Journal of International Economics, Elsevier, Elsevier, vol. 50(2), pages 449-472, April.
  35. Agnese, Pablo & Sala, Hector, 2009. "The fading 1990s in Japan: Driving forces behind the unemployment upsurge," International Review of Economics & Finance, Elsevier, Elsevier, vol. 18(3), pages 428-439, June.
  36. Arellano, Manuel & Bond, Stephen, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 58(2), pages 277-97, April.
  37. Steve Bond, 2002. "Dynamic panel data models: a guide to microdata methods and practice," CeMMAP working papers, Centre for Microdata Methods and Practice, Institute for Fiscal Studies CWP09/02, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  38. Egger, Peter & Pfaffermayr, Michael & Weber, Andrea, 2003. "Sectoral Adjustment of Employment: The Impact of Outsourcing and Trade at the Micro Level," IZA Discussion Papers 921, Institute for the Study of Labor (IZA).
  39. Donald Siegel & Zvi Griliches, 1991. "Purchased Services, Outsourcing, Computers, and Productivity in Manufacturing," NBER Working Papers 3678, National Bureau of Economic Research, Inc.
  40. Sven W. Arndt, 1998. "Super-Specialization And The Gains From Trade," Contemporary Economic Policy, Western Economic Association International, Western Economic Association International, vol. 16(4), pages 480-485, October.
  41. Cadarso, Maria Angeles & Gomez, Nuria & Lopez, Luis Antonio & Tobarra, Maria Angeles, 2008. "The EU enlargement and the impact of outsourcing on industrial employment in Spain, 1993-2003," Structural Change and Economic Dynamics, Elsevier, Elsevier, vol. 19(1), pages 95-108, March.
  42. Geishecker, Ingo & Gorg, Holger, 2005. "Do unskilled workers always lose from fragmentation?," The North American Journal of Economics and Finance, Elsevier, Elsevier, vol. 16(1), pages 81-92, March.
  43. Karsten Bjerring Olsen, 2006. "Productivity Impacts of Offshoring and Outsourcing: A Review," OECD Science, Technology and Industry Working Papers 2006/1, OECD Publishing.
  44. Gorg, Holger & Hanley, Aoife, 2005. "Labour demand effects of international outsourcing: Evidence from plant-level data," International Review of Economics & Finance, Elsevier, Elsevier, vol. 14(3), pages 365-376.
  45. Mary Amiti & Shang-Jin Wei, 2004. "Fear of Service Outsourcing: Is It Justified?," NBER Working Papers 10808, National Bureau of Economic Research, Inc.
  46. Robert Feenstra & Gordon Hanson, 2001. "Global Production Sharing and Rising Inequality: A Survey of Trade and Wages," NBER Working Papers 8372, National Bureau of Economic Research, Inc.
  47. Jose Campa & Linda S. Goldberg, 1997. "The Evolving External Orientation of Manufacturing Industries: Evidence from Four Countries," NBER Working Papers 5919, National Bureau of Economic Research, Inc.
  48. Zvi Griliches, 1995. "The Discovery of the Residual: An Historical Note," NBER Working Papers 5348, National Bureau of Economic Research, Inc.
  49. Arndt, Sven W., 1997. "Globalization and the open economy," The North American Journal of Economics and Finance, Elsevier, Elsevier, vol. 8(1), pages 71-79.
  50. Paul Krugman, 1995. "Growing World Trade: Causes and Consequences," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1, 25th A), pages 327-377.
  51. Elizabeth Webster, 2000. "The Effects of Wages on Aggregate Employment: A Brief Summary of Empirical Studies," Melbourne Institute Working Paper Series, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne wp2000n14, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  52. Mary Amiti & Shang-Jin Wei, 2005. "Service offshoring, Productivity, and Employment," IMF Working Papers 05/238, International Monetary Fund.
  53. FUKAO Kyoji & HAMAGATA Sumio & INUI Tomohiko & ITO Keiko & Hyeog Ug KWON & MAKINO Tatsuji & MIYAGAWA Tsutomu & NAKANISHI Yasuo & TOKUI Joji, 2007. "Estimation Procedures and TFP Analysis of the JIP Database 2006 Provisional Version," Discussion papers, Research Institute of Economy, Trade and Industry (RIETI) 07003, Research Institute of Economy, Trade and Industry (RIETI).
  54. Choi, E. Kwan & Harrigan, James, 2003. "Handbook of International Trade," Staff General Research Papers, Iowa State University, Department of Economics 11375, Iowa State University, Department of Economics.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. KWON Hyeog Ug, 2012. "Offshoring of Japanese Small and Medium Enterprises (Japanese)," Discussion Papers (Japanese), Research Institute of Economy, Trade and Industry (RIETI) 12004, Research Institute of Economy, Trade and Industry (RIETI).

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp5517. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.